Latest news with #TemporaryEmployeeReliefScheme
The Citizen
3 days ago
- Business
- The Citizen
ArcelorMittal hauls Transnet to Competition Tribunal for market abuse
Comes at a time when the logistics operator is undergoing major reforms to allow private operators access to ports and rail. The steel producer says Transnet Freight Rail missed more than 40% of its delivery targets in 2024. Picture: Supplied Ailing steel producer ArcelorMittal SA (Amsa) has hauled Transnet to the Competition Tribunal, accusing the state-owned rail and port operator of abusing its market dominance. Transnet says the complaint of anti-competitive behaviour levelled against it was previously dismissed by the Competition Commission and has now been self-referred by Amsa to the tribunal. 'Transnet is opposing this self-referral and has filed papers accordingly with the Competition Tribunal,' says the logistics operator in a response to Moneyweb. There were hints of disquiet in Amsa's 2024 annual report when it singled out Transnet Freight Rail (TFR) as a key risk to the business that had disrupted production and output volumes, all the while increasing costs. ALSO READ: Government still talking to ArcelorMittal while Seifsa identifies challenges TFR missed more than 40% of its delivery targets in 2024, notes Amsa, which relies on rail for the shipment of iron ore to its mills. Over the previous three years, rail tariff increases outstripped inflation. Amsa, under pressure from customers and government, has deferred its decision to wind down its long steel business following a R1.7 billion loan facility from the Industrial Development Corporation (IDC). It also received a Temporary Employee Relief Scheme (Ters) grant to assist in funding employee costs, which will reduce the drawdown required against the IDC facility. Amsa's performance has been undercut by cheap foreign imports, rising logistics costs and electricity prices that have surged 835% since 2007. ALSO READ: IDC saves ArcelorMittal days before furnaces switched off Tribunal is 'long shot' The tribunal says Transnet has filed an exception application to Amsa's complaint referral in which it seeks to dismiss the complaint on the basis that there is no case for it to answer, or that the key arguments are vague and embarrassing. An exception application is filed when one party in a dispute argues that the case is inherently defective in law. 'At this stage, the filing process is still underway and the merits of the main matter self-referred by Amsa must still be heard,' says the tribunal in response to questions from Moneyweb. Transnet's exception application must first be heard before the main arguments can be considered by the tribunal. 'The Tribunal is yet to hear the matter once filing processes have been completed and will pronounce on its decision after hearing the merits of the complaint,' says the tribunal. Moneyweb approached Amsa for comment but had not received a response by the time of publication. A transport expert who asked not to be named tells Moneyweb that Amsa's approach to the tribunal is a long shot, coming as it does at a time when the state is finally in the process of relinquishing its monopoly over port and rail infrastructure. Port and rail infrastructure are being pried out of Transnet's hands and placed under independent managers as a precondition for allowing private sector operators. ALSO READ: Did government policy kill SA's steel industry? Debt in excess of R140bn Transnet's declining operational performance – which appears to have been arrested in 2024 – is a critical obstacle, alongside Eskom's unstable grid, to faster economic growth. Minerals Council SA reported R50 billion in export losses in 2022 due to TFR's inability to ship sufficient ore to the ports. In 2023, Exxaro was forced to find costlier alternatives such as road due to TFR's rail capacity problems and lower coal prices. Transnet reported a R7.3 billion net loss in 2024, up from R5.1 billion in 2023, driven by higher finance costs and a R9.1 billion provision for a court-ordered payout to Sasol and TotalEnergies for pipeline overcharges. Transnet is appealing the court order. The company is saddled with debt in excess of R140 billion, which it is not in a position to repay without state assistance. This article was republished from Moneyweb. Read the original here.
IOL News
05-06-2025
- IOL News
Pietermaritzburg businesswoman accused of defrauding Covid-19 TERS of R4 million
File A Pietermaritzburg businesswoman has been arrrested for allegedly defrauding the Covid-19 Temporary Employee Relief Scheme. Almost three years after a Pietermaritzburg businesswoman allegedly defrauded the Covid-19 Temporary Employee Relief Scheme (TERS) of millions, she made her first appearance in court this week. Sindisiwe Mdluli-Myeza was arrested on Wednesday, June 4, 2025, by the Directorate for Priority Crimes Investigation (known as the Hawks) on charges of fraud and money laundering. According to Lieutenant Colonel Simphiwe Mhlongo, it is alleged that during the period between November 2020 and October 2022, Mdluli-Myeza applied for the Covid-19 relief fund from the Department of Employment and Labour. "She claimed R4,229,044.61 from the Temporary Employee Relief Scheme. Preliminary investigation revealed that no employees were employed by her company, and the company was not entitled to claim."
IOL News
25-04-2025
- Business
- IOL News
R515 million TERS audit sparks outrage among SA companies over alleged mismanagement by Labour Department
The TERS administered by the Unemployment Insurance Fund (UIF), was implemented to assist employers in paying employees who were employed but not working because of the lockdown. Image: File Hundreds of companies are up in arms over a 'mismanaged' audit process, worth R515 million, launched by the Department of Labour and Employment (DEL) to probe potential theft of benefits provided to workers across South Africa during Covid-19. The Temporary Employee Relief Scheme (TERS), administered by the Unemployment Insurance Fund (UIF), was implemented to assist employers to pay employees who were employed but not working because of the lockdown. The TERS program, administered by UIF, paid out R57 billion to 13.4 million workers through 1.1 million companies during the pandemic, according to minutes from a November 2021 Standing Committee on Public Accounts Parliamentary Committee Meeting. These benefits, research by UNU Wider states, saved at least two million jobs. However, Corruption Watch, summing up various investigations by law enforcement officials, stated in March this year that R351 million was siphoned off during the scheme's two-year run, with only R229 million recovered. Criminal investigations are set to conclude in December. Among the fraudulent types of activities already uncovered included the use of fake ID documents, ID documents from dead people, claims for people who were temporarily employed, and benefits being claimed for 'former employees, whom the Special Investigating Unit found to have been incarcerated at the time,' said Corruption Watch. The latest investigation – awarded to 26 private 'audit' companies at a cost of R515 million – aims to reclaim more funds but has sparked fury over chaotic execution, privacy breaches, and procedural failures. The probe, initiated via tender UIF6/2023 published in February 2024, saw firms appointed in July last year. Seven months later, companies who had facilitated TERS benefits were abruptly ordered to submit 18 pieces of sensitive documentation – including employees' bank statements, and ID numbers – within three days. 'The sheer scale of this bureaucratic nightmare has left businesses scrambling to meet impossible deadlines, with intimidation tactics now seemingly standard practice,' the National Employers' Association of South Africa (NEASA) said in a March statement. It said that the 'unrealistic audit requests [are] followed almost immediately by threats of severe consequences for those who hesitate to comply'. Within a week of the audit's launch, NEASA received over 350 complaints from employers. Sanja Botha, Policy Advisor at NEASA, told IOL that, since auditors sent the requests for information 'we've seen a continuous influx of complaints and queries via email and telephone. The number of businesses being subjected to these audits is staggering and could be in the thousands.' She added: 'The volume of complaints received from employers reflects serious mismanagement and procedural inconsistency on the part of the appointed auditing firms.' Botha stated that 'some audit firms have demanded extensive and sensitive documentation, such as employees' personal bank statements, within unreasonably short timeframes, sometimes as little as 24 hours. This approach is not only impractical but adds insult to injury.' What is more worrying is that there is no mechanism in place to safeguard the employees' private information. While the auditors signed a one-page confidentiality declaration under the Protection of Personal Information Act, the lack of 'clarity or security protocol for how this data is to be transferred or protected' is 'deeply concerning', said Botha. Moreover, said Botha, 'many businesses are unsure whether the audits are even legitimate, as no formal verification mechanism exists to confirm the credentials of these auditors'. Among the issues NEASA has identified include that audit letters are sent for entirely different companies, some, who never even applied for TERS, are being audited, while auditors also arrive on-site without prior notice or any proof of appointment. In multiple cases. 'Employer-appointed independent auditors have found significant errors in the UIF's audit assessments, raising serious questions about the credibility and integrity of the entire process,' said Botha. NEASA has repeatedly raised concerns with the DEL and UIF since March, but 'we have received no responses from either the Minister of Employment and Labour or the UIF,' Botha said. IOL sought comment from both entities on April 7. The UIF initially acknowledged receipt, stating the DEL would respond due to 'centralised communications.' Despite several follow-ups, neither provided answers as the time of writing. IOL
IOL News
22-04-2025
- Business
- IOL News
ArcelorMittal South Africa defers long steel plant closure with R1.7bn government support
An ArcelorMittal steel foundry. The company is receiving a R1.68 billion bailout from government to keep it operational, pending other industrial protection measures still to be implemented. ArcelorMittal South Africa (Amsa) will defer the closure of its loss-making Long Steel plant to August 31 after getting a R1.68 billion injection from the state-owned Industrial Development Corporation (IDC), which will stave off the retrenchment of 3 500 workers and keep operations running for at least six months. In a statement on Monday, the steelmaker said as part of the agreement, Amsa has committed to the continued operation of the Long Steel business and retention of jobs during the deferral period and had also received a Temporary Employee Relief Scheme (TERS) grant to assist in funding employee costs, which will reduce the drawdown required against the IDC facility. "Based on engagements between the company and government, ArcelorMittal South Africa understands that a more market-related and less punitive Preferential Pricing System and export tax on scrap dispensation will be implemented soon, with safeguards imminent. These measures will help level the playing field in the steel industry to the benefit of the country," the company said. The company had asked for lower electricity and freight rail tariffs, the imposition of import duties, and the removal of a scrap metal export tax it says gives its competitors - recycling mini-mills - an unfair advantage. The closure of the long-steel operations, which produce fencing material, rail, rods, and bars used in the construction, mining, and manufacturing sectors, has been expected since November 2023. Amsa CEO Kobus Venter said while this arrangement represents a positive development, he emphasised that sustainable profitability remains the ultimate objective. "The next six months will be crucial in determining whether the Long Steel business can achieve the financial stability required for long-term viability. We are dedicated to this process and appreciate the support of all our partners in this endeavour," Venter said. The National Employers Association of South Africa (Neasa) said it was opposed to the Amsa bailout by the IDC as the company was not sustainable, with old mills. However, CEO Gerhard Papenfus said the continuing propping up of Amsa was at the expense of the downstream industry and taxpayers. "Amsa has received several bailouts in recent months. None of this is good for the downstream industry; it will only drive prices higher. There will be a time when AMSA exists with government funding, but has no customers because the downstream industry is crumbling," he said. Steel and Engineering Federation of Southern Africa (Seifsa) CEO, Lucio Trentini, said the move was welcome, though it was merely kicking the can down the road for a further six months. "This is a bit of light at the end of the tunnel but there is still a long road ahead. We can only be optimistic that the temporary reprieve will lead to a lasting solution," Trentini said. He said part of the gains were that some sectors, including auto manufacturing, had a six-month period to seek alternatives. "We cannot afford to lose Amsa; it is important, but it has to be viable and competitive. We cannot have a primary steel producer disappear, but a more positive outcome will have to be found," he said.
